A Feasibility Study Presented to

The Faculty of the College of Business and Accountancy

University of St. La Salle

Bacolod City

In Partial Fulfillment

Of the Requirement for the Degree

Business Administration

Major in Operations Management

Chua, Angelica Joanne

De Leon, Ramon Adrianne

Ong, Daniel

Rio, Koleen
Chapter 1

Introduction

Brief Background of the Study

After a busy day at work, people want to spend time to relax and to have fun. People in

Bacolod City always want to enjoy their time with their family, friends, classmates, etc. when

they have available time like weekends. The researchers came up with the idea of establishing a

KTV that will accommodate everyone of all ages in Bacolod City. The researchers want

everybody to enjoy their time and relax with their loved ones, barkadas, workmates, classmates,

etc.

Nowadays, KTVs could be found almost everywhere around Bacolod City but it’s not a

child-friendly place because almost all are established near bars and nightclubs. In addition, the

number of foreigners studying in the city gets higher each year, thus, establishing KTVs that

offer foreign languages would be an advantage cited by the researchers.

The business accommodates all groups of people, whether they are a small group (2-5

pax), medium group (6-9 pax), or large group (10-up pax). It will also venture into a small

restaurant for guests to be able to fill their stomachs while enjoying the fun experience of music.

The researchers came up with this business because it targets everybody and not just a particular

set of people and decided to call the business “Musicbox”.

History

Bacolod City is one of the demanding cities in the Province of Negros Occidental since it

is the Capital City and a lot of establishments are now operating well and a lot more are being

constructed giving the Bacoleños the opportunity to utilize their skills and knowledge. The city

has been known all over the country for its unique vibe when it comes to having fun and how

accommodating Bacoleños are to tourists. Therefore, the researchers came up with a new way of

having fun, unwind and be amused. Given the busy lifestyle in the city, the researchers grabbed

the opportunity of making a business that can ease the stress of the Bacoleños out of their hectic

and demanding lifestyle. The business is entitled Musicbox. It is a place where people of all

ages, may they be family, friends, colleagues, tourists, welcomed to a whole new experience,

promoting a cleaner way of having fun and a wholesome environment for them to bond. The

people behind this business are Ms. Angelica Chua, Ms. Koleen Rio, Mr. Daniel Ong and Mr.

Adrianne De Leon.

Statement of the Problem

In Bacolod City, KTVs could be found almost everywhere but there's one thing that the

researchers took notice of: it’s not a child-friendly place, citing the fact that almost all are

established near bars and nightclubs.

Objectives of the Study

The overall aim of the study is to determine the business’ capability to stay in the

industry with the help of the people within the premises, on how will the business benefit the

people of Bacolod in all occasions and further demonstrate the possibility of establishing such

kind of business. Within this broad theme, the research had a number of specific objectives:
 Chapter I: To give a brief background and insights to the nature of KTV
Chapter II: To determine whether KTV is suitable in the Market thus provide
marketing strategies that can be applied in this kind of business
Chapter III: To determine the management approach suited for a business like this
Chapter IV: To determine technical: manufacturing process of the business
Chapter V: To project the profitability and long-standing of the business
Chapter VI: To know the socio-economic aspects created by the business

Significance of the Study

This study was discovered because of the researchers' experiences wherein KTVs are

mostly enjoyed by teenagers and young adults who love to party at night, making older people or

those who have families seem to be neglected when it comes to having fun with KTVs.

Furthermore, the researchers came up on establishing a whole new KTV experience wherein all

ages and culture could find their spot in enjoying themselves offering them a clearer way of

having fun and giving way to families to bond with each other by giving them a child-friendly

environment. This study is significant to these following people:

1. Families who want to experience a whole new way of having fun suited for all ages and

build strong relationships with each other

2. Students who want to relax after their examinations and meeting their deadlines

3. Young Professionals who want to seek pleasure from their works

4. Foreigners who want to enjoy thus allowing them to sing-along to their own language

5. Entrepreneurs who can use this study as a means of knowing what the market wants and

start this business

6. Future Researchers who can use this study as a guide for research studies
Scope and Limitations of the Study

The feasibility study is limited to putting up a KTV business in Bacolod City because the

survey would be gathered in the said area. This study will limit itself to the residential market of

Bacolod City including foreigners. They will also be the possible 100 respondents limited in the

survey. This will focus on how the business will be able to establish stronger bonds and at the

same time relieve stress out through amusing themselves for both family and friends.

The researchers consider this study to find out if it will appeal the market and if it will

last long. And the study will be accomplished during the second semester of A.Y. 2013-2014.

Definition of Terms

o Bacolod City – conceptually, it is a city in the Philippines

(http://en.wikipedia.org/wiki/Bacolod_City)

o Bacoleños – operationally, it refers to the people living in Bacolod City

o Bar – conceptually, it is a retail business establishment that serves alcoholic drinks

(http://en.wikipedia.org/wiki/Bar_(establishment))

o Barkada – operationally, it means a group of friends in Filipino

o Entrepreneur – conceptually, it is a person who organizes and manages any enterprise,

especially a business, usually with considerable initiative and risk

(http://dictionary.reference.com/browse/entrepreneurs)

o KTV – conceptually, it is an abbreviation of “karaoke television”, a form of interactive

musical entertainment in which amateur singers sing along with recorded music

(http://en.wikipedia.org/wiki/Karaoke)

o Lifestyle – operationally, it is the way a person lives

o Nightclub – conceptually, it is an entertainment venue which usually operates late into

the night

(http://en.wikipedia.org/wiki/Nightclub)

o Survey – conceptually, it is a method for collecting quantitative information about items

in a population

(http://en.wikipedia.org/wiki/Survey)

o Young Adult – conceptually, it is generally a person in the age range of 20 to 40

(http://en.wikipedia.org/wiki/Young_adult_(psychology))

o Young Professional – conceptually, it refers to a young person not in school who is

employed in a profession

(http://en.wikipedia.org/wiki/Young_professional)
Chapter II

Marketing Aspects

Introduction

This chapter presents the demand for services, methodology in data gathering, marketing

strategies that includes 4 P’s, demand analysis, SWOT analysis and TOWS matrix of the

business that will help reach the objectives to deliver the service to its target market.

Objectives

The objectives of this chapter are, to design the marketing strategies of the service using

the 4 P’s, to examine the demand and supply of the service through field survey, to create a

SWOT analysis using the TOWS matrix and to determine the best possible position of the

service through Porter’s Analysis.

Methodology

1. Demand Analysis

On the survey conducted, out of 100 respondents, 88 of them answered that they are

interested in going to KTV bars, so this may be of great help to the researchers due to the fact

that are interested in going thus having one in Bacolod City that accommodates all ages giving a

wholesome identity to the business. Most of our customers would be teenagers. We have also

analysed that they spend ₱1,000 - ₱1,500 when enjoying themselves in KTV bars.

Figure 1
57

43

Male Female

Figure 1 shows that out of the 100 respondents from the survey conducted, there were 43
males and 57 females who responded on our proposed Musicbox KTV.

Figure 2
64

36

Students Workers
 Figure 2 shows that from the 43 male and 57 female respondents, 64 of those were
students aged 16 – 21 years old and the remaining 36 were employed citizens of Bacolod City.

Figure 3
88

12

Interested Not Interested

Figure 3 shows that out of the 100 respondents, 88% of them are interested in going to
KTV bars and only 12% of them answered that they are not interested.

Figure 4 Figure 5
57
35
43

Aware Unaware Interested Not Interested

Figure 6
52

Interested Not Interested

 Figure 4 shows that out of the 100 respondents, 57% of them answered that they are
aware of having a Family KTV in Bacolod City and from this rate of 57%, 52 (Figure 6) of them
are interested in having one that accommodates all ages. There is a remaining 43% that are not
aware of having a Family KTV in Bacolod City and from this rate of 43%, 35 (Figure 5) of them
responded to be interested in putting up one in Bacolod City.

Figure 7
47
40

Daily Weekly Monthly

Figure 7 shows that out of 100 respondents, 6 of them go to KTV Bars almost on a daily
basis, 40 responded to go on a weekly basis and 47 go on a monthly basis. (Only 93 out of 100
respondents were both aware of a Family KTV in Bacolod City, thus interested in having a KTV
that accommodates all ages and unaware of a Family KTV in Bacolod City but are interested in
having one around, 7 out of the 100 respondents were unaware of a Family KTV in Bacolod City
and were not interested in having one)

Figure 8
46

33

14

1,000 & Below 1,000 - 1,500 1,500 & Above

 Figure 8 shows that out of 100 respondents, 33 of them normally spend ₱1,000 and below
when visiting a KTV bar, 45 of them spend a range of ₱1,000 - ₱1,500 and 14 of them spend
₱1,500 and above.

Figure 9
80
63

37 35

Private Foreign Private Food

Rooms Songs Bars

Figure 9 shows that from the 100 respondents, there were 63 who liked to avail private
rooms, 80 who like to have foreign songs, 37 liked to have their own private bars and 35 liked to
have foods while they enjoy their stay.
2. Supply Analysis

Name of Variety of
Location Strengths Weaknesses
Competition Product

Terra Dolce  Cleanliness  Not Child-

Sibeeria KTV Building, Hilado  KTV  Technology friendly
St., BC  Club  Near the Bar

 Wide KTV  Not Child-

KGB 23rd St., BC  KTV Room friendly
 Bar  Near the Bar  Cleanliness

Robinson’s  Wide  Technology

Quantum
/  KTV KTV
 Cleanliness
Gaisano City / SM  Arcade Room
 Cramp KTV
Robinson’s /  KTV  Cleanliness Room
World of Fun  Tread
Gaisano City / SM  Arcade  Many Arcade of
Technology
 Very  Tread of
Panda Araneta St., BC  KTV accessible to technology
 Arcade the market
3. SWOT Analysis

STRENGTHS

The Musicbox KTV will be located in one of the high traffic location which is in Lacson

Street; one of the main roads in the city which will result that some people will enjoy coming and

eating at our place. Also, the business we are about to venture will be offering themed rooms that

are based on some countries and will serve a wide range of food cuisines and the rooms will be

cheaper than other KTV Bars.

WEAKNESS

The business will have a slow of return in investment for the capital invested is big.

There will be a lot of employees to be hired so the overhead cost is expensive as well. The KTV

Bar and restaurant will be located in Lacson Street so the rent will be costly. Also, the owners of

the business will not be around all the time so record keeping will be poor. With the wide range

of food cuisines, the chefs should be good in handling the food.

OPPORTUNITIES

Though there may be a lot of existing KTV Bars and restaurant, this business will still be

a new entry to the market and will be able to provide better service than the competitors. Some

restaurant does not offer various cuisines in one place. Other KTV bars are expensive.

THREATS

There are a lot of established KTV Bars and some people have lost interest in going. The

business will offer themed rooms; it might not be as pleasant for some other individuals. The

problem in having a bar is that it is inevitable for people to get drunk that might result violence

and there are chances that they might destroy some appliances. Rather than eating outside, some

families prefer eating at home.

TOWS Matrix

External Opportunities External Threats

 Located at Lacson  Competitors nearby

Street  5 peso KTV in the
TOWS  Themed rooms arcade
 Cheaper than other  Parking space
Matrix
KTV bars
 New place to hang out
with friends and family
 Restaurant and

Internal Strengths SO ST

 Exclusive rooms  Will serve a wide  New entry to the

 Air-Conditioned range of food cuisines market
rooms  Well trained crews  Good ambiance
 WIFI  Affordable rooms  Bar and restaurant
 Secured place will offer fair prices
 Prompt and reliable
service

Internal Weakness WO WT

 Not suitable for kids  New customers  Slow return of

 Smoking area  We can win the hearts investment
of customers by  In a bar, some people
offering cheaper rooms get drunk
4. Product Positioning Using Porter’s Analysis

Threat of New
Entry

Supplier Industry Buyer

Power Competitors Power

Threat of
Substitution

Threat of New Entry

 Economies of scale

 Government policies

 Advancement of technology

 Training of staff

Therefore, threat of new entry is low

Supplier Power

 Moderate suppliers

 Able to change supplier

 KTV equipment can be bought once

Therefore, supplier power is low

Threat of Substitution

 Able to switch KTV due to location

 The density of people in the area

 Other clubs

Therefore, the threat of Substitution is high

Threat of Buyer Power

 The income of the customers

 Price sensitive customers

 Low switching cost

Therefore, threat of Buyer Power is high

Threat of Industry Competitors

 Customer’s loyalty

 High growth in the market

Therefore, threat of Industry Competitors is high

Marketing Strategies

Product / Service

Musicbox KTV will provide a good ambience wherein people can relax and enjoy at the

same time. They can choose tunes from an updated list which will be in various languages. Their

needs will be well taken care of by attentive crew members. Customers will have choices

between a range of Filipino and international cuisines. Alcoholic drinks will be strictly for adults

and the establishment will have wi-fi connection.

Place

Musicbox KTV will be situated along Lacson Street because it has become one of the

major streets that is known to be the business district of Bacolod City where annual festivals are

being held and where businessmen opt to place their businesses.

Promotion

The researchers decided to advertise Musicbox KTV in local TV stations using print

media & radio stations. Flyers would be distributed all over the city to give the people more

knowledge about the business. It will also be of word-of-mouth done by family, friends and

acquaintances. Lastly, social networking would be the best way to advertise since most people

are constantly updated with regards to the latest trends around the metro.
Price

Regular ₱800 first 3 300 / hour after 8sqm P800 consumable

Room hours

Deulxe Room ₱1200 first 3 400 / hour after 12sqm P1200 consumable
hours

No consumable for Party and Regular room?

Chapter III

Management Aspects
Introduction

This chapter tackles the operational goals and management of the Musicbox KTV. This

includes the mission – vision statement and personnel management of the business.

Company’s Mission & Vision

Mission

Musicbox will assure the quality service given to the customers. It will keep exploring

new good things that will be offered to the customers. People behind the business assure that

they will do their best in serving their customers, they will be open-minded on the new ideas that

the customers suggest.

Vision

Musicbox will be known as the most preferred KTV-Restaurant in Metro Bacolod to

serve unique and quality foods, updated songs, and friendly service to the customers. After 3

years and less than 10 years, the business will expand to serve more customers and help

unemployed people get jobs.

Organizational Chart

Partners
Form of Business Ownership
 The business will be a partnership which involves four individuals in managing the

Musicbox. The partners involved will contribute to a common fund for the business to operate.

The partners will divide the profit depending on the partnership contracts.

Daniel Ong ₱ 400,000

Koleen Rio 400,000

Angelica Chua 400,000

Adrianne de Leon 400,000

₱ 1,600,000

Profit Sharing Scheme

`The Musicbox KTV partners have agreed to share the profits according to their

corresponding amount of contribution.

Job Description
 Partners

o The duties of the partners will be the over-all in charge of the business. They will be the
one to decide whether it is good or bad for the business. The partners are usually the
owners of the business.

Operations Manager
o The role of an Operations Manager is to handle and resolve daily issues and to work
with the staff to improve customer service.

Cashier

o The role of a cashier is to handle all cash transaction, check daily cash accounts and
maintaining all report of transactions.

Security Guard

o The role of a Security Guard is to watch over the business property and be a deterrent to
anyone who may want to steal, trespass or damage the property.

Cook

o The role of the cook is to prepare all menu items according to quantity menus,
maintains records of food used and supply on hand, and figures food cost and records
on daily food cost sheet.

Assistant Cook

o The role of an Assistant Cook is, under direct supervision, to assist in preparing and
serving food; clean kitchen utensils, equipment and food preparation areas, maintain a
clean facility and perform other duties as required.

Waiter

o The role of the waiter is to take the orders and serve the customers. They will assure the
cleanliness in every table area.

Janitor

o The role of a janitor is to ensure that the entire business place is sanitary and in the best
condition.

Job Specification
Operations Manager

o Must be an Operations Management graduate

o Has to have strong analytical and problem-solving skills with the ability to improve
services to meet customer needs
o Ensures that process and quality controls are consistently observed; encourages staff
recommendations to optimize processes whenever possible
o Excellent verbal and written communication skills
o Strong leadership skills
o Excellent interpersonal and influencing skills
Cook

o Must have a passion for food

o Advanced cooking skills and techniques
o College graduate
o At least 2 years relevant experience in Hotel and Restaurant
o Modify and create new menus
o Create a wide variety of new dishes.
o Enhancing the food product that is presented to guests.
o Recommend changes to the food product.
o Open to customers' suggestion
Cashier

o Honest with dealing business transactions

o Knowledgeable in basic Mathematics
o Will be held accountable for money loss during his or her shift
o College graduate
Security Guard

o Male applicants only

o 25-35 years old
o Must be a licensed Security Guard
o Minimum of 2 years working experience
Waiter

o Great communication skills

o Knows how to operate a KTV machine
o Can work under minimal supervision
o 18 years and above
Janitor

o Can work under minimal supervision

o Responsible for the general cleanliness and sanitation of the facility and grounds of the
KTV business
o 18 years and above

Personnel Plan

Position Quantity
Operations Manager 1
Cashier 1
Cook 2
Assistant Cook 2
Waiter 3
Janitor 1
Security Guard 1
Bookkeeper 1
Total 12

Retainers Fee for the bookkeeper P2,000 -- this means that you will just pay a retainer

fee for your bookkeeper. The bookkeeper should not be included in your personnel plan

Regular Employees: P 287 per day

How much is your starting salary to your employees?

Company Rules and Policies

Appearance and Behavior

As a Musicbox KTV staff, professionalism towards internal and external clients and co-

staff is essential. Proper social graces, courtesy, bearing, decorum and presentable appearance all

make up a respectable and dignified Musicbox KTV staff.

Working Hours

Punctuality is an important quality of a professional staff. It bespeaks of one’s enthusiasm

to report to work and respect for other people’s time.

Regular Days

Regular work schedule is Tuesday – Sunday 10am – 2am

Up to 11 pm lang open ang ktv? Other ktv opens until when?

Exceptions:

The Musicbox KTV staff may be required to work on Mondays as deemed necessary by

the operations manager in the event that there are reservations of the entire business place.

Time Record

All staff is required to personally log in and out their Daily Time Records in a central log

book or time clock. The said daily time record shall contain information such as the time of
arrival and departure from the business place. This is so required for payroll purposes and proper

monitoring of attendance.

Tardiness / Under time

Should it be unavoidable that a staff be late for at least an hour or more because of a

personal / emergency matter, due notification must be given by the staff to the Operations

Manager for approval and proper monitoring. This in turn may be charged accordingly to one’s

allowable under time / leave credits which should be filed within 24 hours immediately upon

reporting back to work.

Overtime

On regular days, all staff are encouraged to work only within regular working hours. This

is to ensure maximum productivity and efficient use of one’s time.

However, for occasions wherein the client and Operations Manager agreed to extend their

time of stay, Musicbox KTV staff will be given their corresponding overtime pay.

Holidays

In most cases, the Musicbox KTV staff are not required to render work on non-working

holidays unless there are reservations made and approved by the Operations Manager.

Absences / Leaves

Due notice must be given for absences which may be incurred because of sickness or

emergencies. This should be done on the first hour of the working schedule and may be done

either by calling the land line or through a representative or relative of the staff (if the staff if

physically unable to call). Permission to be absent must be obtained directly from the Operations

Manager. Should the staff be absent from work without the approval of the Operations Manager,
he is considered “absent without official leave”.

For long vacations or pre-planned absences, due approval must be obtained from the

Operations Manager at least 1 week before the planned vacation leave to ensure that work

assignments are accounted for and work schedule is not disrupted unnecessarily.

Break Time

Break time should not be taken simultaneously by all staff especially if it would mean

going out of the business premises. This is to ensure that the business place is properly manned

and secured even during break time.

Coffee Breaks

Coffee / Snack breaks are allotted 15 minutes and may be taken on the following schedules:

Evening Break:

6:00 PM to 6:15 PM

6:15 PM to 6:30 PM

Work Place Etiquette

Musicbox KTV strives to maintain a positive work environment where all staff treats

each other with respect and courtesy. As such, everyone is encouraged to keep an open mind and

graciously accept constructive feedback from other people in order to maintain a smooth and

health work relationship with others.

Dress Code

Musicbox KTV staff are expected to dress the prescribed uniform.

Relationship with Society Members / Clients

 “Client is King”. This is the main battle cry of Musicbox KTV in dealing with its’

members and clientele. Each and every person that the Musicbox KTV staff comes in contact

with are treated as “clients” and dealt with respect, kindness and utmost courtesy because they

are considered the lifeblood of the society to whom its very existence depend on.

Below are more guidelines on how to espouse professionalism in dealing with members or

clients:

 Maintaining relationships at a professional level

Though it may be unavoidable to form close personal relationships and friendships with

the members of the society, it is very important that the Musicbox KTV professional maintains

objectivity and confidentiality of internal matters / decisions to ensure that work performance is

not compromised in the course of such ties and relationships.

Relationship with superiors and co-staff

Happiness on the job depends largely on the kind of working relationship one has with

his superiors and co-staff. It is therefore important that a tension-filled environment thriving on

pretty gossips and grudges is avoided. To encourage such an environment, openness is practiced

in order to thresh out minor differences even before it becomes a problem.

Discipline

o Matters pertaining to staff discipline (work hours, compliance with the General Office

Policies / Procedures, Job Performance, etc) is a prime responsibility of the Operations

Manager. As such, verbal or written reprimands are to be initiated solely by him.

Respect and Cordiality

o It is also expected that staff members treat each other utmost respect and cordiality. Too
 much familiarity and closeness with certain individuals must be viewed with utmost

objectivity and professionalism.

Selling / Distribution of Goods

o Selling or distribution of any goods / items is likewise discouraged as it diminishes the

level of professionalism within the office premises.

Use of Office Equipment, Tools and Supplies

Use of the Telephone

In order to maintain a client-friendly relationship and to maximize its use, the telephone

is limited to making client calls and other business-related activities. Prolonged usage of the

phone for personal transactions is strongly discouraged.

As a general rule, calls must be answered within the first 3 rings with a positive

disposition and warm greeting. In case the phone is left unattended, the staff nearest the phone

must pick up the call and not wait for anybody else to do it.

Use of Cell Phones

The use of personal mobile phones inside the business premises should not be abused.

Making unnecessary personal calls or texts during official working hours is very much

discouraged.

Housekeeping and Cleanliness at Work

As a display of professionalism, work areas should be kept clean and neat. As such, desks

shouldn’t be cluttered with documents as these are to be kept inside the filing cabinets or drawers

for security purposes. It is likewise the responsibility of each staff to keep his own area clean.
Safety and Security Control

Desk drawers and cabinets should be locked after business hours to avoid untoward

losses of important business property and documents.

Unauthorized entry of people who are not part of the society and have no business with

any of it’s’ representatives is not tolerated nor encouraged.

Staffs are enjoined to note and immediately bring to the attention of the Operations

Manager any faulty electric wiring for immediate repair. Desks and cabinets should not be left

pulled out. Computers should be shut down, electrical cords of printers, calculators and other

office equipment should not be left along the aisles. Plug extensions should be turned off after

work.

Smoking

To provide a safe and healthful work environment, smoking is prohibited inside the

business premises. This is to ensure that no untoward incidents occur because of any form of

negligence.

Emergencies

In the event of the following emergency situations i.e. typhoons, earthquake, fire, flash

floods, transport strikes, demonstrations / rallies, volcanic eruptions, civil disturbance and other

calamities, the Operations Manager shall make an overall assessment of the situation and with

the Partners’ concurrence may advise the staff to go home unless it is safer to remain within the

business premises.

It is likewise the responsibility of the Operations Manager on duty at the scene of a

calamity or accident to take action as necessary to provide required assistance to the staff and
protect company equipment / interests. The course of action to be taken shall be determined by

the nature and extent of the injuries or damage incurred.

Compensation

Based on the viability of the society, the compensation package is reviewed and upgraded

from time to time to make it responsive to prevailing economic realities.

Pay Schedule

Monthly salaries are released in two payments, one on the 15th of the month and the

other half on the 31st of the same month. As a rule, pays are released 2 days in advance to ensure

safety and security of our people during the expected pay days. The amount due to each staff is

en-cashed from the bank and released personally by the Owners / Operations Manager.

In the event that the payday falls on a Saturday (non-banking day) or on a non-working

day / holiday, the pay is released in advance.

Benefits

Vacation and Sick Leave

One is entitled to a 15 day Sick Leave and a 15 day Vacation Leave immediately upon

regularization. At the start of each calendar year, the new set of SL and VL entitlements is

refreshed for availment.

VACATION AND SICK LEAVE CONVERSION

As a policy, unused vacation leaves are not convertible to cash. This is so implemented to

ensure that the staff also enjoys some reasonable time away from work and thus, enjoy a

healthier and stress-free lifestyle. As such, the staff is encouraged to plan ahead together with the
Operations Manager as to how the said vacation leave can be availed of without disrupting

normal work operations.

Unused sick leaves on the other hand are convertible to cash at the end of the year and

may be released together with the 13th month pay.

LEAVE WITHOUT PAY

The staff members may be granted leave of absence without pay for emergency purposes

if the said staff has no vacation leave credits anymore or has used up all his sick leave credits.

Availment of said absence of leave without pay is pending the Operations Manager’s approval.

Resignation

If a staff decides to resign or leave the company, he is required to submit a letter of

resignation addressed to the Operations Manager / Owner. Resignation letters should be

submitted at least 30 days before the effective date. This is to give Musicbox KTV enough time

to find a replacement as well as prepare all necessary clearances and benefits the staff is entitled

to.

Exit Interview

An exit interview is conducted by the Operations Manager upon receipt of the resignation

letter. He either uses this as an opportunity to convince the person who tendered the resignation

to stay with the society or to uncover organizational issues which may be contributing factors to

a person’s decision to leave. The Owners may also opt to conduct the exit interview should it

deem necessary to do so.

Benefits Entitlement upon separation

Upon separation, members are entitled to the following:

o 13th month pay (pro-rata)

o Unused balances of the earned vacation leave (if applicable)

o Unused balance of the earned sick leave (if applicable)

Chapter IV

Technical Aspects

Introduction

This chapter assess the details of how you will deliver a product or service and technical

feasibility study is an excellent tool for trouble-shooting and long-term planning. In some

regards, it serves as a flow chart of how your products and services evolve and move through

your business to physically reach your market. The objectives of this Chapter is to determine

what kind of process and policies will be implemented in the business, thus can provide good

business concepts in some technicalities.

Process Flow

Start

Customer

Inquire service
availability for KTV
or Restaurant

If Available Proceed to KTV

Yes room or dining
table

Ask customer if
they are willing to
No wait for the next
available KTV
Table of Materials

Furnitures and Fixtures

Item Qty Price per unit Total
Cash Register 1 ₱5,000.00 ₱5,000.00
Filing Cabinet 1 ₱4,000.00 ₱4,000.00
Display Rack Counter 2 ₱7,000.00 ₱14,000.00
Dining Tables 10 ₱1,500.00 ₱15,000.00
Sofa 6 ₱10,000.00 ₱60,000.00
Chairs 50 ₱300.00 ₱15,000.00
Small Square Tables 6 ₱1,000.00 ₱6,000.00
Fire Extinguisher 2 ₱7,000.00 ₱14,000.00
₱133,000.00

Leasehold Improvement
Item Qty Price per unit Total
Sink 3 ₱1,500.00 ₱4,500.00
Lock 10 ₱100.00 ₱1,000.00
Office Light 7 ₱600.00 ₱4,200.00
Door Knob 10 ₱300.00 ₱3,000.00
Paint 24 ₱800.00 ₱19,200.00
Faucet 5 ₱500.00 ₱2,500.00
Switch 15 ₱100.00 ₱1,500.00
Extension Wire 10 ₱600.00 ₱6,000.00
Roller Brush 5 ₱35.00 ₱175.00
Hollow Block 150 ₱10.00 ₱1,500.00
Cement (bags) 10 ₱100.00 ₱1,000.00
Wash Sand 8 ₱200.00 ₱1,600.00
Thinner 3 ₱35.00 ₱105.00
Outlet 20 ₱100.00 ₱2,000.00
Toilet bowl 5 ₱2,500.00 ₱12,500.00
Gravel 5 ₱130.00 ₱650.00
Kitchen Sink 1 ₱4,000.00 ₱4,000.00
₱65,430.00

Miscellaneous
Item Qty Price per unit Total
Aircon 8 ₱25,000.00 ₱200,000.00
Emergency Light 7 ₱200.00 ₱1,400.00
TV Sets 2 ₱28,000.00 ₱56,000.00
KTV Sets 6 ₱25,000.00 ₱150,000.00
Calculator 2 ₱200.00 ₱400.00
DVD Player 3 ₱3,000.00 ₱9,000.00
Mop Squeezer 2 ₱350.00 ₱700.00
USB 3 ₱200.00 ₱600.00
₱418,100.00

Bar Utensils
Item Qty Price per unit Total
Food tongs 3 ₱38.00 ₱114.00
Ice tongs 10 ₱30.00 ₱300.00
Blender 2 ₱1,800.00 ₱3,600.00
Chopping Board 3 ₱150.00 ₱450.00
Peeler 3 ₱44.00 ₱132.00
Stainless Pitcher 10 ₱99.75 ₱997.50
Toothpick Dispenser 10 ₱20.00 ₱200.00
Tissue Holder 10 ₱69.00 ₱690.00
Ice Scooper 2 ₱35.00 ₱70.00
Bar Tray 10 ₱10.00 ₱100.00
Bottle Opener 2 ₱79.00 ₱158.00
Bar Knives 3 ₱110.00 ₱330.00
₱7,141.50

KTV Supplies
Item Qty Price per unit Total
Ball pens 10 ₱10.00 ₱100.00
Pencils 10 ₱5.00 ₱50.00
Receipts, Order Slips, Request 3 ₱50.00 ₱150.00
Form
Carbon Paper 2 ₱140.00 ₱280.00
Cash Register Paper 10 ₱50.00 ₱500.00
Record Books 3 ₱30.00 ₱90.00
Notebook 2 ₱13.00 ₱26.00
Short Bond Paper 2 ₱150.00 ₱300.00
Long Bond Paper 2 ₱180.00 ₱360.00
Straws 24 ₱20.00 ₱480.00
Plastic/Paper Bags 16 ₱30.00 ₱480.00
Tooth picks 25 ₱15.00 ₱375.00
₱3,191.00
Maintenance Supplies
Item Qty Price per unit Total
Floor Mop 3 ₱100.00 ₱300.00
Dust Pan 3 ₱30.00 ₱90.00
Soft Broom 3 ₱30.00 ₱90.00
Liquid Floor Wax 2 ₱50.00 ₱100.00
Towels 10 ₱50.00 ₱500.00
Floor Soap 3 ₱100.00 ₱300.00
₱1,380.00

Kitchen Utensils
Item Qty Price per unit Total
Casserole 3 ₱900.00 ₱2,700.00
Rice Cooker 2 ₱4,000.00 ₱8,000.00
Dinner Spoons 100 ₱25.00 ₱2,500.00
Dinner Forks 100 ₱25.00 ₱2,500.00
Teaspoon 50 ₱22.00 ₱1,100.00
Deep Fryers 2 ₱2,000.00 ₱4,000.00
Freezer 1 ₱30,000.00 ₱30,000.00
Toaster 1 ₱1,500.00 ₱1,500.00
Microwave 2 ₱2,000.00 ₱4,000.00
4 gas burner with oven 1 ₱15,000.00 ₱15,000.00
2 gas burner 2 ₱1,500.00 ₱3,000.00
Steak Knives 50 ₱35.00 ₱1750.00
Measuring Cup 2 ₱60.00 ₱120.00
Can Opener 2 ₱300.00 ₱600.00
Spatula 2 ₱63.00 ₱126.00
Kettle 2 ₱375.00 ₱750.00
Vegetable Peeler 2 ₱50.00 ₱100.00
Blender 2 ₱3,500.00 ₱7,000.00
Butcher’s Knife 3 ₱500.00 ₱1,500.00
Cheese Grater 2 ₱190.00 ₱380.00
Mixing Bowl 5 ₱290.00 ₱1,450.00
Plate Rack 2 ₱500.00 ₱1,000.00
Glass Rack 2 ₱300.00 ₱600.00
Chopping Board 4 ₱140.00 ₱560.00
Ice Scooper 2 ₱50.00 ₱100.00
Ice Bucket 10 ₱100.00 ₱1,000.00
Trash Can 2 ₱300.00 ₱600.00
Utility Can 2 ₱713.00 ₱1,426.00
Steak Plate 30 ₱100.00 ₱3,000.00
Steak Pot 5 ₱400.00 ₱2,000.00
LPG 5 ₱1,500.00 ₱7,500.00
Water Dispenser 2 ₱700.00 ₱1,400.00
Drinking Glass 70 ₱25.00 ₱1,750.00
Shot Glass 30 ₱10.00 ₱300.00
Soap Sanitizer 4 ₱100.00 ₱400.00
Plates 100 ₱30.00 ₱3,000.00
Bowls 60 ₱30.00 ₱1,800.00
Condiments 15 ₱69.00 ₱1,035.00
₱115,547.00

Menu

APPETIZERS

Selling Price
Peanuts P10.00 P35
Cheese Sticks P50.00 P90.00
Hungarian Sausage P122.00 P150.00
Beef Tapa P100.00 P150.00
 Buffalo Wings P80.00 P185.00
Pork Sisig P40.00 P80.00
Squid Sisig P60.00 P120.00
Crispy Kangkong P10.00 P30.00
Chicharon P40.00 P60.00
Fried Lumpia P30.00 P50.00
French Fries P30.00 P50.00
Calamares P65.00 P100.00
Onion Rings P40.00 P70.00
Squid Rings P70.00 P100.00

MAIN COURSE

FILIPINO CUISINES

Selling Price
Inasal P40 P75
Fried Chicken P30 P50
Lechon Kawali P75 P110
Crispy Pata P200 P355
Dinuguan P75 P100
Pork BBQ P5 P20
Chorizo P60 P100
Bulalo Steak P150 P250
Sinigang Fish P120 P200

CHINESE CUISINES

Selling Price
Hinanese Chicken P80 P120
Sweet and Sour Pork P90 P150
Soyed Chicken P100 P185
Siomai P30 P60
Chicken feet P50 P80
Patatim P175 P210
Siopao P40 P60

THAI CUISINES

Selling Price
 Thai Chicken Salad with Rice P50 P100
 Noodles
Thai Chicken Curry P70 P175
Herb Salad Spring Rolls with P50 P90
Spicy Peanut Sauce
Pad Thai Noodles P30 P60
Fish and Vegetable Soup with P60 P130
Lime

ITALIAN CUISINES

Selling Price
Osso Bucco P150 P250
 Quick Sausage and P100 P200
Mushroom Lasagna
 Roasted Veal Shanks with P90 P170
Rosemary
 Spaghetti and Meatballs P50 P120
 Braised Red Cabbage with P30 P90
Vinegar

Others

Selling Price
Roast Beef P150 P250
Roast Chicken P40 (per part) P100 (per part)
Fillet Minion P150 P300
Fish and Chips P100 P200
Pesto Chicken P90 P150
Beef Salpicao P150 P210
Chicken Salpicao P100 P150
Lamb Chops P180 P300

RICE

Selling Price
Plain P5 P15
Garlic P7 P20
Pilaf P10 P30
Mashed Potato P10 P25
Java Rice P10 P30
PASTA

Selling Price
Bolognese P70 P100
Carbonara P70 P120
Seafood P90 P175
Lasagna P60 P100
Fettuccini P60 P100

SANDWICHES & BURGERS

Cheeseburger P75 P130

Turkey Burger P100 P150
Veggie Burger P70 P120
Double Beef Burger P100 P190
BLT P100 P150
Fish Fillet Burger P80 P130
Clubhouse Sandwich P70 P120
Ham & Cheese Sandwich P70 P120
Roast Beef Sandwich P100 P180
Grilled Cheese P30 P80
Tuna Sandwich P40 P90

BEAVERAGES

Coke P7 P20
Sprite P7 P20
Royal P7 P20
Mountain Dew P7 P20
Iced Tea P8 P25
Bottled Water P7 P20
Mango Shake P30 P60
Buko Shake P25 P45
Mango Juice P20 P40
Apple Juice P30 P45
Pineapple Juice P30 P40
Orange Juice P10 P25

ALCOHOLIC DRINKS

San Mig Light P25 P50

San Mig Strong P25 P50
San Mig Super Dry P25 P50
Red Horse P20 P45
Pale Pilsen P20 P45
Tanduay Ice P20 P45
Tanduay Blue P20 P45
Tanduay Red P20 P45
Empirador P100 P200
Empirador shot P50
Fundador P70 P150
Vodka P100 P300
Vodka Shot P50
Tanduay P50 P100
Jose Cuervo (bottle) P700 P1500
Jose Cuervo shot P90
House Wine (bottle) P200 P400
House wine glass P90
Whiskey (bottle) P1,500 P2,500
Whiskey glass P250

Waste Disposal Scheme

After the operation hours, the janitors will collect all the waste of the business so that it

can be dispose of properly. The garbage collector will then take the trash during their rounds.

Utilities
 The business will need water and electricity. The Bacolod City Water District will handle

the water and the Central Negros Electric Cooperative, Inc. will handle the electricity.
Vicinity Map
Building Layout

entrance

restroom

The size of your rooms is not specified. Kindly refer this to your marketing strategy under
price. The rooms must fit to your marketing plan.
Building Perspective
 Gantt Chart

MONTH JANUARY FEBRUARY MARCH APRIL

WEEK 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4
Location of the business

Get necessary permits

Renovation

Hiring of employees
Acquisition of machineries &
equipment

Advertising

Orientation of employees

START OF OPERATION

I think you have to adjust your gannt chart based on the the financial analysis.

Actual operations will start January 2015 in the projections.

FINANCIAL ASPECT

Project Cost

Total project cost includes purchase of properties and equipments, supplies and pre-operating
expenses. The total of which is ₱937,989.50 and is broken down below.

Properties and equipment

Furniture and fixtures ₱133,000.00
Leasehold improvement 65,430.00
KTV equipment 418,100.00
Bar utensils 7,141,.50
Kitchen utensils 115,547.00
₱739,218.50
Office and maintenance supplies
Office supplies ₱ 3,191.00
Maintenance supplies 1,380.00
4,571.00

Pre-operating expenses 194,200.00

Total Project Cost ₱937,989.50

Sources of Financing

The project costs and expenses shall be financed by the partners thru their initial contribution to
the project. They are committed to invest ₱400,000 each for the project or a total of ₱1,600,000.

Assumptions

The 5-year projected financial statements are prepared based on the following assumptions:

1. Sales are based on the projections made for the period and would increase by 10% every
year.
2. Salaries and wages and rent would increase at 5% per annum and the rest of expense account.
3. An additional cook and assistant cook shall be hired in the second year of operations to give
better service to its customers as the KTV is projected to have more customers in the
succeeding years.
4. Properties and equipment shall have no salvage value.
5. Useful life for office and ktv furniture and fixtures would range from 3 to 5 years.
6. Useful life for KTV and Kitchen equipment is five years.
7. Useful life for Kitchen tools is 3 years so the business will procure another set of Kitchen
tools after three years.
8. Inventories are maintained at 10% of Cost of Sales.
9. Pre-operating expenses shall be charged outright to the initial year of operations.
10. The partners shall divide the profit and loss based on their investment.
11. The partnership is not subject to income tax; however, the share of partners in the profit are
subject to income tax and shall be paid personally by the partners.
12. Profit for the first two years of operations shall be retained in the business.
13. On the third year of operations, 40% of the profit shall be divided by the partners.

FINANCIAL PROJECTIONS

See excel file for the financial projections

FINANCIAL ANALYSIS RATIOS

See excel file

FINANCIAL ANALYSIS

Musicbox KTV is a very liquid company with its current and quick assets higher than its

accounts and other payable for 15 to 61 times. Since most of its transactions are on cash basis,

the company can avail of lower cost for foods, beverages, drinks, etc. offered to customers and

later expand.

Fixed Asset Turnover show that fixed assets are fully utilized to generate sales for the company.

However, total assets turnover show a declining trend, indicating the company is not maximizing

its assets to generate more income. This observation is confirmed by the declining profitability

ratios. This is the reason why the partners think of investing their excess cash by establishing

another branch when the right place is identified.

CAPITAL BUDGETING ANALYSIS

See excel file for the figures

Payback period takes a little more than one (1) year indicating that the KTV is a profitable

business as confirmed by its net present value with 0% borrowing cost. The internal rate of

return is 103.01%, hence the company is able to recover its investment cost 7 times over a period

of five years.